Mobile Ops In Romania Say Telecom License Fees Should Be Set In Auctions

"We don’t think authorities made the right decision when they set a fixed fee for the use of the 3.600-3.800 MHz, 410-415 MHz and 420-425 MHz frequency spectrum. It would have been fair to do what other European Union states do and have operators set the license fee following an auction,” said Marian Velicu, vice-president for strategy, regulations and public affairs of Vodafone Romania.

For the national license to use frequencies 410-415 MHz and 420-425 MHz, which allows the provision of broadband mobile communication services, the government set a fee of the lei equivalent of EUR1,077,228. The auction is not open to Orange Romania, Vodafone Romania, Cosmote Romania, Telemobil and RCS&RDS, who own mobile telecom licenses (GSM, 3G).

For licenses to use the radio spectrum for 3.600-3.800 MHz, allowing the provision of WiMAX-based telecom services, the fee could rise to EUR7.5 million/license, according to a draft government decision.

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On the sidelines of a seminar, Velicu said the local telecom market is developed and has grown out of the emergent stage and authorities should keep the industry attractive.

"There is high development potential on the data transmission segment. Vodafone Romania will continue to invest in this market segment,” Velicu said.

Gabriel Dogaru, adviser to the general manager of Orange Romania, backed the idea that license fees should be set by auction.

"We have to be more careful with regulations that keep Romania from nearing the average in telecom industry indicators specific to EU states," Dogaru said.

He added that attracting new investments in the telecom sector may be achieved by authorities by easing the granting of building permits, which companies need to set up specialized equipment.

"We’re having trouble getting building permits, as the process takes too long and authorities could do something about that,” Dogaru said.

The vice-president of the country’s IT&C regulator ANRCTI, Alexandrina Hartan, said three myths are apparent among telecom industry representatives: saturation, the regulation/investments ratio and the Romania’s alignment to EU regulations.

"We believe regulations don’t slow down investments and one example is Romtelecom, which invested EUR400 million in the past two years. We also believe regulation keeps operators in shape and prepares them for competition,” Hartan said.

The official added the Romanian telecom market still has large potential for development, as the country has a reduced degree of penetration for hard-line telephony and a relatively low number of internet connections.

The Romanian mobile telecom market is operated by Orange Romania, Vodafone Romania, Cosmote Romania, Telemobil and RCS&RDS, which is also present on the hard-line telephony and cable and satellite TV services markets.

Alongside Romtelecom, the hard-line telephony market also includes UPC Romania.